Preface to the book
TRADING WITH THE ENEMY: An Exposé of The Nazi-American Money-Plot
1933-1949 by Charles Higham

Delacorte Press - 1983, hard cover

Preface

It would be comforting to believe that the financial Establishment of
the United States and the leaders of American industry were united in a
common purpose following the Day of Infamy, the Japanese attack on Pearl
Harbor on December 7, 1941. Certainly, the American public was assured
that Big Business along with all of the officials of government ceased
from the moment the war began to have any dealings whatsoever with the
enemy. That assurance sustained the morale of millions of Americans who
bore arms in World War II and their kinfolk who stayed at home and
suffered the anguish of separation.
But the heartbreaking truth is that a number of financial and
industrial figures of World War II and several members of the government
served the cause of money before the cause of patriotism. While aiding
the United States' war effort, they also aided Nazi Germany's.
I first came across this fact in 1978 when I was declassifying
documents in the course of writing a biography that dealt with motion
picture star Errol Flynn's Nazi associations. In the National Archives
Diplomatic Records Room I found numerous cross-references to prominent
figures who, I had always assumed, were entirely committed to the
American cause, yet who had been marked down for suspected subversive
activities.
I had heard over the years about a general agreement of certain
major figures of American, British, and German commerce to continue
their relations and associations after Pearl Harbor. I had also heard
that certain figures of the warring governments had arranged to assist
in this. But I had never seen any documentary evidence of it. Now,
pieces of information began to surface. I started to locate documents
and have them declassified under the Freedom of Information Act—a
painfully slow and exhausting process that lasted two and a half years.
What I found out was very disturbing.
I had been born to a patriotic British family. My father had raised
the first battalions of volunteers against Germany in World War I, and
had built the Star and Garter Hospital at Richmond, Surrey, for
ex-servicemen. He had been knighted by King George V for his services to
the Crown and had been a member of Parliament and a Cabinet member. I
feel a strong sense of loyalty to Britain, as well as to my adopted
country, the United States of America. Moreover, I am part Jewish.
Auschwitz is a word stamped on my heart forever.
It thus came as a severe shock to learn that several of the greatest
American corporate leaders were in league with Nazi corporations before
and after Pearl Harbor, including I.G. Farben, the colossal Nazi
industrial trust that created Auschwitz. Those leaders interlocked
through an association I have dubbed The Fraternity. Each of these
business leaders was entangled with the others through interlocking
directorates or financial sources. All were represented internationally
by the National City Bank or by the Chase National Bank and by the Nazi
attorneys Gerhardt Westrick and Dr. Heinrich Albert. All had connections
to that crucial Nazi economist, Emil Puhl, of Hitler's Reichsbank and
the Bank for International Settlements.
The tycoons were linked by an ideology: the ideology of Business as
Usual. Bound by identical reactionary ideas, the members sought a common
future in fascist domination, regardless of which world leader might
further that ambition.
Several members not only sought a continuing alliance of interests
for the duration of World War II but supported the idea of a negotiated
peace with Germany that would bar any reorganization of Europe along
liberal lines. It would leave as its residue a police state that would
place The Fraternity in postwar possession of financial, industrial, and
political autonomy. When it was clear that Germany was losing the war
the businessmen became notably more "loyal." Then, when war was over,
the survivors pushed into Germany, protected their assets, restored Nazi
friends to high office, helped provoke the Cold War, and insured the
permanent future of The Fraternity.
From the outset I realized that in researching the subject I would
have to carve through an ice cream mountain of public relations. I
searched in vain through books about the corporations and their
histories to find any reference to questionable activities in World War
II. It was clear that the authors of those volumes, granted the
cooperation of the businesses concerned, predictably backed off from
disclosing anything that would be revealing. To this day the bulk of
Americans do not suspect The Fraternity. The government smothered
everything, during and even (inexcusably) after the war. What would have
happened if millions of American and British people, struggling with
coupons and lines at the gas stations, had learned that in 1942 Standard
Oil of New Jersey managers shipped the enemy's fuel through neutral
Switzerland and that the enemy was shipping Allied fuel? Suppose the
public had discovered that the Chase Bank in Nazi-occupied Paris after
Pearl Harbor was doing millions of dollars' worth of business with the
enemy with the full knowledge of the head office in Manhattan? Or that
Ford trucks were being built for the German occupation troops in France
with authorization from Dearborn, Michigan? Or that Colonel Sosthenes
Behn, the head of the international American telephone conglomerate ITT,
flew from New York to Madrid tot Berne during the war to help improve
Hitler's communications systems and improve the robot bombs that
devastated London? Or that ITT built the Focke-Wulfs that dropped bombs
on British and American troops? Or that crucial ball bearings were
shipped to Nazi-associated customers in Latin America with the collusion
of the vice-chairman of the U.S. War Production Board in partnership
with Göring's cousin in Philadelphia when American forces were
desperately short of them? Or that such arrangements were known about in
Washington and either sanctioned or deliberately ignored?
For the government did sanction dubious transactions—both before and
after Pearl Harbor. A presidential edict, issued six days after December
7, 1941, actually set up the legislation whereby licensing arrangements
for trading with the enemy could officially be granted. Often during the
years after Pearl Harbor the government permitted such trading. For
example, ITT was allowed to continue its relations with the Axis and
Japan until 1945, even though that conglomerate was regarded as an
official instrument of United States Intelligence. No attempt was made
to prevent Ford from retaining its interests for the Germans in Occupied
France, nor were the Chase Bank or the Morgan Bank expressly forbidden
to keep open their branches in Occupied Paris. It is indicated that the
Reichsbank and Nazi Ministry of Economics made promises to certain U.S.
corporate leaders that their properties would not be injured after the
Führer was victorious. Thus, the bosses of the multinationals as we know
them today had a six-spot on every side of the dice cube. Whichever side
won the war, the powers that really ran nations would not be adversely
affected.
And it is important to consider the size of American investments in
Nazi Germany at the time of Pearl Harbor. These amounted to an estimated
total of $475 million. Standard Oil of New Jersey had $120 million
invested there; General Motors had $35 million; ITT had $30 million; and
Ford had $17.5 million. Though it would have been more patriotic to have
allowed Nazi Germany to confiscate these companies for the duration—to
nationalize them or to absorb them into Hermann Göring's industrial
empire—it was clearly more practical to insure them protection from
seizure by allowing them to remain in special holding companies, the
money accumulating until war's end. It is interesting that whereas there
is no evidence of any serious attempt by Roosevelt to impeach the guilty
in the United States, there is evidence that Hitler strove to punish
certain German Fraternity associates on the grounds of treason to the
Nazi state. Indeed, in the case of ITT, perhaps the most flagrant of the
corporations in its outright dealings with the enemy, Hitler and his
postmaster general, the venerable Wilhelm Ohnesorge, strove to impound
the German end of the business. But even they were powerless in such a
situation: the Gestapo leader of counterintelligence, Walter
Schellenberg, was a prominent director and shareholder of ITT by
arrangement with New York—and even Hitler dared not cross the Gestapo.
As for Roosevelt, the Sphinx still keeps his secrets. That supreme
politician held all of the forces of collusion and betrayal in balance,
publicly praising those executives whom he knew to be questionable.
Before Pearl Harbor, he allowed such egregious executives as James D.
Mooney of General Motors and William Rhodes Davis of the Davis Oil
Company to enjoy pleasant tête-à-têtes with Hitler and Göring, while
maintaining a careful record of what they were doing. During the war, J.
Edgar Hoover, Adolf A. Berle, Henry Morgenthau, and Harold Ickes kept
the President fully advised of all internal and external transgressions.
With great skill, he never let the executives concerned know that he was
on to them. By using the corporate leaders for his own war purposes as
dollar-a-year men, keeping an eye on them and allowing them to indulge,
under license or not, in their international tradings, he at once made
winning the war a certainty and kept the public from knowing what it
should not know.
Because of the secrecy with which the matter has been blanketed,
researching it presented me with a nightmare that preceded the greater
nightmare of discovery. I embarked upon a voyage that resembled nothing
so much as a descent into poisoned waters in a diving bell.
Why did even the loyal figures of the American government allow
these transactions to continue after Pearl Harbor? A logical deduction
would be that not to have done so would have involved public disclosure:
the procedure of legally disconnecting these alliances under the
antitrust laws would have resulted in a public scandal that would have
drastically affected public morale, caused widespread strikes, and
perhaps provoked mutinies in the armed services. Moreover, as some
corporate executives were never tired of reminding the government, their
trial and imprisonment would have made it impossible for the corporate
boards to help the American war effort. Therefore, the government was
powerless to intervene. After 1945, the Cold War, which the executives
had done so much to provoke, made it even more necessary that the truth
of The Fraternity agreements should not be revealed.
I began with the conveniently multinational Bank for International
Settlements in Basle, Switzerland. The activities of this anomalous
institution in wartime are contained in Treasury Secretary Henry
Morgenthau's official diaries at the Roosevelt Memorial Library at Hyde
Park, New York. Other details are contained in reports by the estimable
Lauchlin Currie, of Roosevelt's White House Economics Staff, whom I
interviewed at length by telephone at his home in Bogotá, Colombia, to
which city he had been banished, his citizenship stripped from him in
1956 for exposing American-Nazi connections. Another source lay in
reports by the late Orvis Schmidt of Treasury Foreign Funds Control.
German records were a useful source: Emil Puhl, vice-president and real
power of the Reichsbank, a most crucial figure in The Fraternity's
dealings, had sent reports to his nominal superior, Dr. Walther Funk,
from Switzerland to Berlin late in the war.
I turned to the matter of the Rockefeller-controlled Chase National
Bank, which had conducted its business for the Nazi High Command in
Paris until the war's end. Evidently realizing that future historians
might want to examine the highly secret Chase Bank files, Morgenthau had
left subtle cross-references at Hyde Park that could lead future
investigators to Treasury itself. I asked Ralph V. Korp of Treasury for
access to the sealed Chase boxes, which had been under lock and key
since 1945. Under the Freedom of Information Act, Mr. Korp obtained
permission from his superiors to unseal the boxes and to declassify the
large number of documents contained therein.
From the Chase Bank it was a natural progression to Standard Oil of
New Jersey, the chief jewel in the crown of the Rockefeller empire.
Records of Standard's dealings with the Axis were contained in the
Records Rooms of the Diplomatic Branch of the National Archives were
specially declassified. There, too, I found records of Sterling
Products, General Aniline and Film, and William Rhodes Davis, whose FBI
files were also most revealing. Documents on ITT and RCA were
declassified. After waiting out the better part of the year, I was able
to obtain them from the National Archives. Classified SKF Industries
files are held in the Suitland, Maryland, annex of the Archives. General
Motors matters are covered in the James D. Mooney public access
collection of Georgetown University, Washington, D.C. The unpublished
post–Pear Harbor diaries of Harold Ickes were invaluable; they are to be
found in the manuscript room of the Library of Congress.
The most elusive files were those on Ford in Occupied France. I
could find no reference to them in the Treasury documentary listings. I
knew that a Treasury team had investigated the company. I wondered if
any member of the team could be alive.
Something jolted my memory. I remembered that a book entitled The
Devil's Chemists had appeared after World War II, written by Josiah
DuBois, an attorney who had been part of the Treasury team at Nuremberg.
The book was a harrowing account of the trial of the executives of I.G.
Farben, the Nazi industrial trust, that showed Farben's links to Wall
Street.
I reread the book's pages, looking for a clue. In it DuBois
mentioned that he came from Camden, New Jersey. I decided to call
information in the Camden area because I had a theory that, embittered
by his experience in Germany and Washington, DeBois might have returned
to live there after the war. It was only a hunch, but it paid off. In
fact, it turned out that DuBois had gone back to his family law firm in
Camden. I wrote to him, asking if he had records of the Ford matter. I
figured that these might have been so important that he would have been
given personal custody of them; that Secretary Morgenthau might not even
have risked leaving them at Treasury.
DuBois replied that he believed he still had the documents,
including the letters of Edsel Ford to his managers in Nazi-occupied
France after Pearl Harbor, authorizing improvements in automobile and
truck supplies to the Germans. After several weeks, DuBois wrote to say
that he had searched his attic to no avail. The documents were missing.
However, he would keep looking.
He was admitted to a hospital where he underwent major surgery.
Although enfeebled, he returned to the attic and began searching again.
Compelled by a desire to disclose the truth, he pursued his task
whenever he could find the strength. At last, when he was about to give
up hope, he uncovered the documents.
However, he explained that the main files was so incendiary that he
would not send it by mail or even by messenger—I was at liberty to
examine it in his office. I was faced with a new dilemma. Since I was
expecting delivery of an important set of documents, I couldn't risk an
absence from my house for a prolonged journey to the East. I said I
would call him back.
I knew that Rutgers University was close to DuBois's offices. I
called the Law department and asked for a student researcher. Within an
hour I received a call from a young man who needed work. I contacted
DuBois's secretary and arranged for the student to copy the documents of
the premises. He did so; I sent an air courier to his home to pick them
up. As I read the documents, the last details of the puzzle fell into
place.
I have tried to write this book as dispassionately as possible,
without attempting a moral commentary, and without, of course, intending
implication of present corporations and their executive boards. It will
be claimed that the people in this book, since they are dead, cannot
answer and therefore should not be criticized. To that I would reply:
Millions died in World War II. They, too, cannot answer.